Empirical Studies in Timeshare Resales - Alan Winter, 1998

Empirical Studies in Timeshare Resales
Author Alan D. Winter, University of Luton, 1998"
tags: timeshare, sales, private, help, study, selling, time, share, interview, survey
Copyright 1998 Alan D. Winter. All rights Reserved
A Schedule was prepared for this study, that included a Pilot Survey: Link
A website was created following this survey and that was actively run by the writer between 2000 and 2008. TimeshareUK.com.

Empirical Studies in Timeshare Resales



University of Luton© Alan D Winter. 1998. submitted in partial completion for the award of BSc (Hons) Marketing and Business Systems, Luton University, April 1998.


Abstract


The second hand timeshare vendor has an enormous task to sell his ownership. In the UK over 120,000 timeshare units are registered with resale agents who rarely achieve annual sales of more than 8% of their inventory. Up to now, academic work has largely ignored the resale of timeshare. This study explores academic marketing literature, secondary timeshare marketing knowledge, and primary evidence gathered from UK developers, resale agents and private vendors.

A timeshare has a marketing mix of purchase price, physical location, time of year, size of unit, and exchange facilitator. A telephone poll of 31 privately owned timeshares found that (1) 81% of sellers consider the general idea of timeshare to be good or very good, (2) 47% of sellers who have exchanged believe exchange fees are high, (3) 68% were or had been registered with resale agents, (5) 24% of all respondents had used resale agents unapproved by the Timeshare Council, and yet, (6) second-hand sellers are largely not negative about the timesharing concept.

  • Summary
The marketing techniques of timeshare developers representing 20 UK resorts were examined and the results are presented. Developers employ many different techniques in marketing communications, and some of these techniques may be useful to private vendors. SUMMARY OF UK RESORT MARKETING BY ACTUAL RESPONSE.

 

For my wife and daughter
Acknowledgements


I am grateful for the help of:

Sandy Grey of the Timeshare Consumer Association for reviewing an early draft of this project, and making suggestions.

Alan Wood of Timeshare direct, resale agent.

Merle Harper of Primeshare International, resale agent.

UK timeshare resort developers who took part in a postal survey.

Private advertisers who took part in a telephone survey.

Tony Pyne, project supervisor, for help and suggestions.

 

Table Of Content


1. Problem

2. Background To The Problem
2.1 Timeshare not an investment
2.2 Extent of timesharing
2.3 Exchanging
2.4 Oversupply
2.5 Internet
2.6 Cooling-off period
2.7 Ignorance
2.8 Demographics
2.9 Buyer Profile
2.10 Resale Price
2.11 Benefits and Disadvantages of Club X Timeshare

3. Literature
3.1 Motivation
3.2 Sales Promotion
3.3 Auction
3.4 Demarketing
3.5 Five Forces Analysis
3.6 Sales Personnel
3.7 Literary Conclusions
4. Hypotheses

5. Study Of UK Timeshare Developers, 1997.
5.1 Summary
5.2 Background
5.3 Methodology Options
5.4 Pilot and Full Survey
5.5 Response
5.6 Data Analysis of Promotion Methods
5.7 Critique of the Survey
5.8 Conclusion and Limitations

6. Resale Agents
6.1 Introduction
6.2 Literary Research
6.3 Methodology
6.4 Summary of Findings
6.5 Further Study

7. Exploratory Research Study of Private Vendors, 1997
7.1 Summary
7.2 Introduction and Literature
7.3 Method
7.4 Findings
7.5 Conclusions
7.6 Further study

8. Structured Telephone Survey of Private Vendors
8.1 Summary
8.2 Background and Literature <
8.3 Methodology
8.4 Pilot Questionnaire
8.5 Questionnaire
8.6 Data Analysis
8.7 Literal Responses
8.8 Analysis of Timeshare Private Vendors Survey
8.9 Analysis of Private Vendors Survey by cross tabulations
8.10 Critique
8.11 Conclusions
8.12 Further Study

9. Overall Conclusions
9.1 Marketing Recommendations For A Second-Hand Timeshare

10. Further Research

11. References

Table of Appendices

  1. Sample of UK Timeshare Developers Survey: Questionnaire
  2. Sample of UK Timeshare Developers Survey: Cover Letter
  3. UK Timeshare Developers : Marketing Techniques
  4. Exploratory Interviews With Resale Agents
  5. Example Interview with Private Vendor
  6. Private Vendor Telephone Survey: Database from "Loot"
  7. Private Vendor Telephone Survey: Survey Response
  8. Private Vendor Telephone Survey: Literal Responses



Lists of Tables and Figures
  1. table 1. How many of your representatives have received at least 2 hours training in the last six months?
  2. table 2. Opinion of asking price by location of timeshare owned.
  3. table 3. Opinion of Own Sale Price by Opinion of Exchange Fees
  4. table 4. Vendors Sale Price by Purchase Price
  5. table 5. Examination of Exchange
  6. table 6. Period Registered with Resale Agents
  7. table 7. Registered with Resale Agent compared to Vendors Opinion of Own Asking Price
  8. table 8. Academic marketing theory and implications for timeshare.
  9. table 9. Sales promotion experimental work and the implications for timeshare
  10. Figure 1. Options in the Disposal of Timeshare, from observation. 11
  11. Figure 2. The Complex Timeshare Annual Search Process 18
  12. Figure 3. Marketing and the relationship between needs and wants, Mill and Morrison, 1985



Empirical Studies in Timeshare Resales

1. The Problem

A timeshare owner living in England wishes to sell his ownership of two consecutive weeks timeshare at Club X in Spain. Each unit accommodates up to six people. The total purchase fee paid in 1989 for the two weeks was £4290. There are variable annual management fees, currently £180 per week owned.

In December 1994, Mr Y registered the timeshare weeks with an agent recognised by the Timeshare Council. A registration fee was paid to the agent. The asking price has gradually been lowered from £1800 for each week to £950 per week owned. In spite of this no offers have ever been made. Another two agents, not making a registration charge, also recognised by the Timeshare Council, were asked to try to sell the ownership rights in the summer of 1997.

Mr Y is concerned that the current agents might not be doing all that can be done to sell his particular weeks. Are there more effective ways? He is aware that the image of timeshare is generally poor and is concerned that too many second hand vendors might hold negative views, discouraging sales in the second-hand market.

2. Background To The Problem

 
2.1 Timeshare not an investment

Holiday timeshare is the ownership of accommodation for a specified annual period. Disick and van der Ploeg (1994) concluded that a properly structured vacation ownership club provides a sound means of raising investment capital for resort development. According to various sources, timeshare should be viewed by the individual as an investment in future holidays and not a property investment. Ziobrowski and Ziobrowski concluded that timeshares are a very poor use of capital (Appraisal Journal, October 1997). Owners pay original purchase fees, annual maintenance fees, plus optional membership and exchange fees to organisations that facilitate exchange.

2.2 Extent of timesharing

At the end of 1996, Mintel/Ragatz Associates estimated there were 4,550 resorts around the world, and 3.5 million owners. More than a third of the resorts are within the United States. In 1997 Britons owning timeshared accommodation in Europe was estimated at 335,000 in 1997 (Mintel Marketing Reports, November, 1997). 85% of UK owners own abroad of which 36% own in the Canary Isles, and 22% own in Spain (1995 figures).

2.3 Exchanging

On payment of membership and exchange fees to an exchange organisation, owners can exchange their holiday weeks for weeks in resorts all over the world. Resort Condominiums International (RCI) is the world’s biggest holiday exchange organisation with 3,100-plus affiliated resorts in 85 countries. More than 2.2 million timeshare owners from 191 countries are RCI members. Eight of every 10 vacation exchanges are confirmed through RCI each year. In 1996, RCI confirmed nearly 1.7 million timeshare exchanges, sending more than 6 million people on vacation. In 1995 RCI had 180,000 UK members; Interval International (II), the next biggest, had 60,000. These figures are not wholly reliable since different sources quote different figures and some owners belong to both RCI and II. Growth of multi-centre owned resorts enables owners to exchange whilst avoiding the exchange fees of exchange organisations.

2.4 Oversupply

There is evidence of over-supply of timeshare resale units. Primeshare International, reputedly Britain's biggest resale agents, have over 122,000 weeks of timeshare registered with them, by some 75,000 clients owning in 3,000 timeshare resorts. Of these, Primeshare make 1,800 sales a year.

 


Figure 1. Options in the Disposal of Timeshare, from observation.


Second-hand Options in the Disposal of a Timeshare


Do not pay maintenance fees, forget about it.


Bequeath it


Rent it, Sell it privately


Rent it, sell it through an agent
¯ ¯ ¯ ¯


¯


Pass problem to someone else


How? Where?
May have to pay a fee.


Lose original capital payment. May be sued for fees. May be sold for you by the resort leaving vendor fraction of purchase price
¯ Outcome: May not recover maintenance fees Outcome: A realistic asking price could be 40% of purchase price.


2.5 Internet

At this time, the use of the internet and the world wide web for timesharing is developing. RCI and II make information about resorts available to internet users. Owner-to-owner direct exchanges, rentals, sales and purchases can be facilitated via a growing army of independent world wide web sites. The study of the Internet, as a medium of effectiveness for sales conversions from internet advertising, has been difficult to measure within the time-scale of this project. In the UK only an estimated 15% of the population in the UK have ever used the Internet and then mostly for e-mail facilities. This means that internet advertising of timeshare in the European market is certainly no more effective than existing paper mediums.

2.6 Cooling-off period

The biggest single cause of unrest about timeshare ownership has been the hard-sell techniques used by some developers. The Timeshare Act of October 1992 gave purchasers in the United Kingdom 14 days to call off a purchase agreement. A 10-day cooling off period was introduced 29th April 1997 to most European countries, but unscrupulous marketers still find loopholes to outwit the legislation to the disadvantage of the consumer.

In a study into insurance agents, Howe, Hoffman, Hardigree, and Donald (1995) carried out research which found that customer-oriented sales were found to engage in less unethical behaviour than their sales-oriented counterparts. Unethical practices undoubtedly do contribute to giving timeshare the negative image that it does not want.

Since the 1992 Act, the author of this report has visited and had first-hand experience of one Scottish resort, one Cornish resort, one Welsh resort and one English Lakes resort. No untoward interaction took place which alerted the author to any unethical practice. Prior to the Act, the author had one London resort bad experience. The sales technique at that English resort had involved the enticement of "a free holiday abroad, or smaller prizes," for attending a presentation. Intensive pressure selling for 4 hours took place at the resort, rounded off by a salesperson insisting that he accompany the author to his home by train in order to obtain a visa card number.

The entry to the market by major hospitality groups such as Airtours, Disney, Hyatt and Marriot lends respectability to timesharing.

2.7 Ignorance

Despite 950,000 Britons taking timeshare holidays in 1996, there is a great public ignorance about timeshare. For example, in a poll for Mintel, to the statement, "In most cases, you can exchange/swap timeshare accommodation to another location or country" only 29% agreed.

2.8 Demographics

Club X, in Spain, can be classed as a beach/resort location, in an area best appreciated by the use of a car. According to Mintel (1996) regardless of lifestage, beach/resort holidays are the most popular type being the choice of 35% of all adults. 4.2% of all adults stay in a holiday home or timeshare, with 1.7% of adults hiring a self-drive car abroad. 4.7% of all adults took holidays in Spain (TGI, 1997). Mr Y’s owned timeshare weeks, in December, are at a time of year when just 1% of all people in the UK start their main holiday (TPR Associates,).

2.9 Buyer Profile

According to middleton (1994, p48), there is a high propensity to engage in travel and tourism among people who have/are: 1) a high income per household, 2) two employed parents, 3) large city dwellers, 4) a high level of qualifications, 5) younger people, 6) two or more cars in the household, 7)six or more weeks’ paid holiday. Based on these and demographic findings, the profile of the best prospect for a second-hand timeshare at Club X, is someone who is: A car driver, aged 30 to 50, is a manager, employer or professionally qualified person, lives in the Greater London area of England. The prospect is likely to buy the timeshare for the purposes of exchanging rather than taking annual holidays beginning in December.

2.10 Resale Price

Resale companies advise that a price of between £400 and £1,000 per week might be achievable for the 2-bedroom accommodation owned by Mr Y. This represents a fall in value of between 50%-75% over the developer price in 1989.

2.11 Benefits and Disadvantages of Club X Timeshare

The main benefits of Club X timeshare ownership are,
The nature of being able to exchange to over 4,550 other resorts in over 89 countries at any time of the year. The size of the apartment, which is larger than many other resorts in Spain.


The main disadvantages are summarised as,
  • Poor opportunities of resale. 
  • Low resale price achievable as compared to price paid if bought through a developer and its agents.
  • The obligation to pay annual maintenance charges whatever an individual’s financial circumstances are, failure of which may cause the ownership entitlement to be revoked. 
  • The payment of membership fees to an exchange organisation without credit for years when an exchange is not required. 
  • The necessity to pay fees to facilitate any exchange.



3. Literature

Extensive research for academic work which looks specifically at timeshare, in the vacation sense, has revealed very little. This is surprising because timeshare has existed for nearly thirty years now, with significant growth in the past ten years. Timeshare can be analysed by consumer behaviour motivation theory, sales theory, and marketing communications theories to name but a few.

 
3.1 Literature - Motivation


Goodall (1998, Chapter 1) postulates that growth in real income has contributed to a holiday being one of the family’s most desirable consumable products. The prospect of a holiday motivates an individual to "escape from work, escape from a routine, or respite from everyday worries" (ibid. p3). Murphy (1985) classifies these motivations as physical or physiological (health, sport, challenge), cultural, social or prestigious, and fantasy. It can be postulated that timeshare holiday makers do not need to be motivated. As owners, they have paid in advance for holidays in capital payments and maintenance charges. They are committed to the concept of taking a timeshare holiday, whether it is at their own resort or at another resort for which additional exchange fees are payable. Consequently, the need to be motivated for a holiday, is removed, and the annual holiday is assumed to be part of the routine.

Goodall offers a complex chart showing the annual holiday search process of a potential tourist. He admits that for some tourists the selection choice is more straight forward. For many, the process is complicated by a wide choice of factors demanding meticulous planning of almost every detail. The timeshare tourist is not included in his analysis. The selection process for a timeshare owner is more complex. Choices exist in the world at large, as well as in the arena of timeshare.

Goodall uses the generic term "Search Process" in consideration of the typical tourist search process. To include timeshare, the diagramatic representation of the search process needs to be updated. The result is shown in Figure 2. The updated version complicates the choice for the timeshare owner, who can
explore the wider holiday market, use the holiday weeks owned, exchange, store the weeks owned for a holiday at a future time.


Figure 2.The Complex Timeshare Annual Search Process (Winter, A. 1997, adapted from The Tourist’s Annual Search Process, Goodall, 1988.)

complex timeshare diagram by Alan D Winter


Mill and Morrison (1985) hold that the difference between a need and a want is one of awareness. Marketers have the task of transforming needs into wants by making the individual aware of his or her need deficiencies. The marketing task is to convince an individual that the purchase is the best, if not the only way of satisfying that need.

 


Figure 3.
Marketing and the relationship between needs and wants, Mill and Morrison, 1985










The tourist industry tries to create the most favourable images of particular destinations (Goodall 1988). Lifestyle scenarios, within niche and wide-appeal brochures, attempt to woo potential clients to book with them. Here is an area of dynamic dissonance for timeshare owners. Package holiday brochures are available to the public, and in the natural search for information on a destination, the timeshare owner may see something which seems to hold more appeal than the choice which has already been committed to. Here is a possible cause of negative thoughts about timeshare, which may provoke an attempt to sell.

Illustrating the last point, in ‘Project S’ Thompson sought "to deliver a product that would differentiate Thompson … increase brand loyalty, moving the purchase decision to value and quality…" (Astles, ed. middleton, 1994). The project examined the needs and wants of customers, particularly looking at the four key accommodation attributes. These were fixtures and fittings, food, service, and entertainment. The implications for timeshare resorts, sold as ‘quality’ or ‘luxury’ holidays, is that they should have at least some of the attributes of the Thompson Sun Hotel brochure proclamation.

 
3.2 Literature - Sales Promotion

Blomberg (1995) argues that the key to success in sales involves the combination of marketing plans and specific formalised selling approaches, driven by the results of market research and a direct-mail campaign. The extent to which professionals, that is timeshare developers, their agents, and second-hand agents, use a mix of methods to sell timeshare units is an important piece of information to the private seller. Blomberg’s assertion, if true in timeshare, means that a private vendor cannot expect things to happen just by taking one single action such as placing an advertisement in newspaper column.

Bass (1997) concluded that

"selling will be more effective when salespersons are both emotionally and intellectually appealing as well as considerate of their customers’ needs… Effective salespersons arrange to keep up-to-date with the customers’ problems and needs".


The implication is that vendors, need to show a knowledgeable enthusiasm for the timeshare product. Further, the inquirers’ needs should be assessed in order to appeal to their needs. Finally, after sending information to an inquirer, the vendor should follow-up and try to understand what any problem or delay in replying is.

A study by Nicholls (1996) recommends that,

"Real estate managers should consider crafting a sales assistance program to enhance the relationship with both the owner and purchaser and to clarify the manager’s role and liabilities".


Two implications arise. Firstly, some timeshare resorts do operate a resale scheme, but those that do not, could conceivably benefit in the long run. The offer of clear guidelines to those who are selling could improve credibility of the resort management. Secondly, the exchange element in the transaction may also be better portrayed if the exchange organisations were to offer literature particularly designed for a private seller to pass to the sales prospect. The trade-off would be a new member.

3.3 Literature - Auction

Wesling (1992) concluded that surplus real estate is increasingly being sold through auctions. According to Gwent Group, a consulting firm that tracks the industry, from 1980 through 1991, the number of real estate auction sales has risen 13% annually. In the UK timeshare auctions are operated by Trinity Factors for example.

3.4 Literature - Demarketing

In 1971, Kotler and Levy raised the theory of demarketing,

"that aspect of marketing that deals with discouraging customers in general or a certain class of customer in particular on either a temporary or permanent basis."


Lowther, Hastings and Lowry (1997) reconsidered this theory. Their extensive research uncovered little academic work in the intervening years. The theory warrants discussion. Reducing the number of timeshares for sale, increases scarcity, and improves the price obtainable. However, there are many suppliers of timeshare, unbound by a professional body, to commit to stop development which might reduce the quantity supplied.

The common denominators are the exchange companies RCI and II, operating in a virtual duopoly. If they were to desist from issuing exchange rights to anyone unless they bought from a private seller, theoretically there would be more emphasis on purchasing second hand.

3.5 Literature - Five Forces Analysis

The theory of the last paragraph falls down, even through a rudimentary five forces analysis (Porter, 1979). For exchange companies, there exist many business threats.
  • Other smaller exchange companies already exist (competitive force);
  • holiday tour organisations could move into the exchange business (threat of entry);
  • Internet growth and with it the threat of alternatively arranged do-it-yourself exchanges (threat from alternatives);
  • Developers, being customers of RCI and II, big enough to forge links with one another to create their own effective exchange groups (supply threat);
  • Existing timeshare owners may move to other exchange organisations (customer threat).


 

3.6 Literature - Sales Personnel

In assessing how successful salespeople are, Lancaster and Jobber (1994, p304) argue the importance of establishing precise information. They define the information required as finding out:
  • Precisely who will be responsible for authorising the purchase,
  • Exactly when they will be in a position to buy,
  • Where he or she will be when the decision to buy is made,
  • Why they want to buy from us, rather than someone else,
  • Uncover how the purchase will be paid for.
Applying these concepts to timeshare, "Who?" helps the timeshare vendor to know whom they are dealing with. Others involved in the buying process may also need to be provided with information. Whoever makes the initial enquiry, there may be other members of the enquiring family or friends that need also to be persuaded that the one timeshare is the one to purchase.

Consumer behaviour theory is well established, in that the buying decision process can consist of many role-players (for example see, Kotler, Armstrong, Saunders, and Wong, 1996, p. 275-6). Kotler et al list, (1) an initiator (perhaps a neighbour who mentions their timeshare); someone who influences (maybe a friend in a bar who says he has seen timeshare advertised cheap in "Loot"); (2) a decider (perhaps the wife who needs to counter sign a cheque); (3) a buyer (perhaps the senior male in the household who signs the cheque and some legal papers to make the purchase); (4) and the users ( perhaps the children, who actually might be more keen on a beach/resort holiday than anyone else in the household). To uncover in the course of telephone conversation, who it is that is involved in the purchase will therefore assist any sale. The decider, perhaps the wife of the buyer, might be influenced by calling back at another time of day. With an idea of the users, the vendor could make play of relevant facilities and activities that might appeal.

Knowing when the buyers will be able to buy could ease the anxiety of waiting beyond a certain time for future response to initial enquiries. Knowledge of "when" will give the vendor an idea of how quickly he/she needs to act to provide information.

Knowledge of where the decision will be made can be crucial. Perhaps the potential buyer would like to stay at the resort to experience it before making the purchase? This means the vendor may need to be prepared to make that offer, if necessary, to further encourage a purchase.

Uncovering the reason for choosing the timeshare against all others puts the vendor in a better position to make a more profitable sale. A timeshare has a marketing mix of purchase price, physical location, time of year, size of unit, exchange facilitator. The vendor cannot assume that because someone has replied to their private advertising that, for example, it was the price that attracted the enquirer. Knowing which factor drew the applicant to approach the seller places the vendor in a better position to encourage a sale by talking about the key factor.

Finally, "How will the purchase be funded?" may be of use. If a loan has to be arranged, the vendor may be aware of where to get a low rate of interest. Offering this knowledge could speed up the sale.


3.7 Literary Conclusions

Sales promotion has been covered many times in academic marketing literature, but little has covered timeshare and, so far as can be ascertained, none has considered the second-hand market for timeshare. Additional study is required. Do private vendors use the who, what, why, when, how methodology Lancaster and Jobber enthuse over? Do vendors hold negative views of timeshare and therefore put potential buyers off? The remainder of this work focuses on study areas which could be enlarged upon in their own right to bring about a fuller understanding of the nature of marketing a second-hand timeshare.

 
4. Hypotheses



H1. UK Resort developers hold successful selling knowledge that a secondary vendor can utilise.

H2. Resale agents discourage sales, yet maximise their own income by encouraging resale registrations.

H3. Second-hand sellers portray a negative image of timeshare, making it difficult for developers, resale agents, and other owners to make a sale. A telephone interview of timeshare vendors will be undertaken to examine this hypothesis.

H4 Second-hand vendors do not use successful sales techniques.



5. Study Of UK Timeshare Developers, 1997.

5.1 UK Timeshare Developers - Summary

Some suggestions which a vendor could use to market the timeshare arise from studying timeshare developers methodologies,
  • Adopt a professional approach,
  • Run a small direct mail campaign,
  • Follow-up any lead,
  • Use knowledge gained about low-cost flights to advise a potential purchaser,
  • Consider adjusting the offer price, so that the first year’s maintenance fees will be paid.

5.2 UK Timeshare Developers - Background

In a 1996 study Mintel found that half of their sample would not consider buying a timeshare, one third of them believing "that timeshare companies used dubious selling methods". To achieve a positive press would be helpful to owners trying to sell their timeshares.

The UK has had a Timeshare Act since 1992 which allows buyers a 14 day cooling off period (see 2.6). The resort developers in the UK have had the longest period in Europe to adjust to marketing under the buyer's "freedom-to-reconsider" environment. Their selling methods ought not be similar to the practices which still go on in some areas of the world, notably Canary Islands, where a tout still might ‘cajole and bully’ a holiday maker for 4 to 5 hours into saying "yes". (TCA, 1997, and writer’s own experience).
The hypothesis to be queried is "Resort developers hold successful marketing and selling knowledge that a second-hand vendor can utilise".


5.3 UK Timeshare Developers -Methodology Options

The data sample decided on was whole population of 86 timeshare sites identified within England, Scotland and Wales, that affiliate to RCI and/or UKRE. Language problems, and the need to arrange postal returns from many countries, to a small budget, negated the opportunity of selecting a sample of resorts across the globe. Time to gather in responses was also limited and this is why the design was restricted to the 86 resorts mentioned. Questionnaire design took into account many findings of marketing research writers (ABI abstracts) particularly, (1) to be clear in meaning, (2) avoid ambiguity, (3) mix up response format to avoid boredom put on correspondents, (4)put questions in a sensible order, (5) be short and simple, (6)follow the unique objectives of the study, (7) printing questionnaire on two single sides to improve response rate.


5.4 UK Timeshare Developers - Pilot and Full Survey

A pilot questionnaire was sent to ten randomly selected resorts from the survey population on 21 August 1997. Respondents were enticed to make a swift return by being invited to take part in a National Lottery Draw (sample letter and questionnaire in appendices). A 40% return of this pilot was received inside a week, the replies received representing nine resorts. Amendments were made to improve the questionnaire, for example, it had not been anticipated that replies would be sent back representing more than one site.

5.5 UK Timeshare Developers - Response

In all, replies representing 27 resorts were received of which 20 were usable, and qualified for the National Lottery Draw. Five were no longer marketing weeks, and two reported a policy of not replying to surveys of this kind. The author speculates that many more responses may have been possible, had the mailing of the full questionnaire not coincided with the death of Diana, Princess of Wales which brought about a week of unofficial national mourning.

5.6 UK Timeshare Developers - Data Analysis of Promotion Methods

All results are reported out of 20 replies.

5.6.1 
UK Timeshare Developers - Data Analysis - Promotion: country

11 resorts do no advertising anywhere, 7 advertise in England/Scotland/Wales, 1 did not reply.

5.6.2 
UK Timeshare Developers - Data Analysis - Promotion: media

Promotion media of the resorts takes place in a variety of locations. See next page. None of the promotion methods was mentioned in replies to the qualitative question "Which marketing technique works especially well for you?"

5.6.3 
UK Timeshare Developers - Data Analysis - Promotion: feeding awareness

Customer awareness is particularly fed via direct mailing of prospects (13), and offering discounted mini-breaks (11). Two reported mailing out free of charge videos to prospects. Customer awareness is also improved in the UK by people "coming in off the street" to look around, of their own curiosity.

5.6.4 
UK Timeshare Developers - Data Analysis - Promotion: incentives

Incentives to own include: free RCI or II membership (13); low cost flights (8); discount cards to use in local shops (7); and payment of management fees (6).

To the question, "do you actively encourage owners to be involved in sales promotion?" 15 replied "yes", 5 replied "no". To the question "how do you involve owners?", 10 offered bounties for successful introductions; 5 asked for prospect lists; 4 'giving their friends accommodation paid holidays at the resort'; 1 gave professional videos to pass onto friends; 1 'holding home-parties at the marketing companies expense; 3 'involved in some other way'

5.6.5 
UK Timeshare Developers - Data Analysis - Promotion: follow-up

11 thought it "very important", and 5 "important" to follow up prospects that do not buy at a certain time. Ragatz (in Hawkins 1985, p261) showed that 45% of non-buyers were "maybe interested" in buying holiday property. This survey finding shows that marketers in the UK believe in the importance of follow-up. In the next survey into private vendors, evidence of follow-up will be looked for, to see if private vendors follow this 'rule'.
A cross tabulation of ‘Promotion inducements and Owner involvement in promotion’ shows a significant relationship between ‘offering bounties for successful introductions’ and ‘offering discounted mini-breaks or renting unsold weeks’ and ‘sending direct mail to selected households.’

5.6.6. UK Timeshare Developers - Data Analysis - Professional Approach

Hawkins (1985, p261), suggested improvements to marketing timeshare would be,

"Professionalize the sales staff; devote at least half of 1% in sales revenue to sales and management training; develop a core of full-time sales staff using a salary-bonus compensation plan…"

The anticipated quantified responses were not always quantified making analysis difficult. However, a trend can be recognised. Not surprisingly, resorts with most units to sell have many more sales staff than those who do not. Importantly, UK timeshare marketers responding to this survey do train their staff where there is substantial number of units for sale. Secondly, there is strong indication of a "salary- bonus compensation plan" being paid to retain important staff.

 

table 1. How many of your representatives have received at least 2 hours training in the last six months?"





At least 2 hours training in the last 3 months (Read)


How many sales staff are paid by…


Code number of replying sites.


Salary Only Staff


Commission only staff


Salary – bonus compensation plan
1


3
3
0
2


outside marketers
5
ALL
ALL






10 and 11


1




12
0
2




13
0




1


14,15,16,17
60
10
60
40


18,19,20
3 (All)
0
0
3


21,22,23
ALL


ALL


24
ALL




ALL

5.6.7. UK Timeshare Developers - Data Analysis - Successful Methods
To the qualitative question "Which marketing technique works especially well for you?", no one method, alone, could be identified. Replies to this question are listed in the appendices.


5.7 Critique of Survey


5.7.1. Whilst the survey gathered information about methods employed it did not gather information which related the methodology to return on investment of each methodology.

The Marketing effort was not clearly identified. Effort within the questionnaire was made to determine how many of which types of weeks were sold or being sold. The intended aim was to look for variation of marketing effort applied. Incomplete, and vague numerical answers prevented proper analysis of this.

This study was undertaken to uncover successful selling techniques of UK vendors. Any findings are inconclusive as (1) the survey consisted of data representing just 20 UK resorts, (2) other methodologies, including observation and obtaining feedback from buyers is needed to corroborate the findings.

In conclusion, it is tabled that developers in England, Scotland, and Wales use many methods to build consumer awareness, feed interest, and bring about conversions to sales.



6. Resale Agents

6.1 Resale Agents - Introduction

The base problem of this study was to determine how best to dispose of a timeshare interest in Spain. One method which had already been tried was to register with a Timeshare Council recommended resale company in 1993. Another, agent, was engaged in summer 1997, and no fee was payable.

6.2 Resale Agents - Literary Research

Extensive research for academic work relating to timeshare resale agents revealed none. Parallel agencies in other products were not investigated as this would have generated too much work for this study.

6.3 Resale Agents - Methodology

Effort was made to uncover resale agents methodology via secondary research, and telephone conversations with UK based resale agents and probe. These are contained in the appendices.

6.4 Resale Agents - Summary of Findings
The resale market in Europe suffers from over-supply. The success of a resale company depends partly on the willingness of clients to reduce prices in some cases by more than 50% of original purchase price.
Demarketing (Kotler and Levy) is practised, as only a handful of properties appear in newspaper advertising when, in fact, agents have thousands of timeshares registered for resale.
  • The disposal of timeshare at an unpopular time of year is improved when it is presented as a free gift when another timeshare is bought.
  • Likelihood of sale of second-hand timeshare is improved when consumers take a tour of the resort.
  • Likelihood of sale of second-hand timeshare is improved when vendors ask low prices.

6.5 Resale Agents - Further Study

The findings themselves are insubstantial, being based on three conversations, but could form hypothesis for future academic study. The way timeshare agents communicate their messages in paper, voice and electronic means could be explored, measured, and compared to determine successful methodologies.


7. Exploratory Research Study of Private Vendors, 1997



7.1 Private Vendors - Summary

It is demonstrated, inconclusively, that second-hand vendors of timeshare can present a positive image about timeshare. There is little evidence to suggest that private vendors, advertising timeshare in Loot, either help effect sales by use of either sales or marketing techniques.

 7.2 Private Vendors - Introduction and Literature

Shapiro (1973) argued that "personal selling is an important means of communication which is most effective when the audience is small and the message complex". Private advertisers, attempting to sell timeshares through their own communication have a complex message to put over. How effective, then, are private advertisers?

Should a timeshare be sold or marketed? The approaches are different and require different methods. Kotler, Armstrong, Saunders, Wong (1996, p28) state that the selling concept is one of stimulating custom through heavy selling and promotion. They contrast this with the marketing concept, which involves researching the needs and wants of a well-defined target market and delivering the desired satisfactions. What approach do private timeshare vendors take when responding to telephone calls from prospective purchasers?

middleton (1994, p 92) states that by measuring perceptions and images it is possible to identify strengths and weaknesses. By focussing on strengths, organisations can steer their products via the techniques of the marketing mix. The test for timeshare second-hand marketing is "are the strengths concentrated upon" when talking to a potential buyer? In other words, do private vendors observe what the caller is asking, and make judgements about any perceptions of the caller? Do vendors build upon perceived strengths in the course of conversation and concentrate their effort on key aspects of a timeshare’s marketing mix?


7.3 Private Vendors - Method

Timeshare for sale advertisements were randomly selected from the free UK advertising newspaper, ‘Loot’. Six taped interviews were conducted with advertisers on the pretext of being a buyer. Findings were extracted and summarised, and later used to draw up a structured interview to further explore negative attitudes of vendors. Evidence was searched for to dismiss H3 "Second-hand sellers portray a negative image of timeshare, making it difficult for owners generally, to make a sale".

The interview situation was obviously false as the interviewer was not actually interested in buying, and there was no chain of people involved in the ‘buying’ process. Nevertheless, an attempt was made to make the enquiries as genuine as possible. The aim was to uncover whether or not the "who, when, where, why, how" questions, as outlined in the discussion above, were asked. (H4 Private vendors do not employ successful sales methodology). If evidence were found that these questions were asked, then it could be said that a successful sales methodology was employed. A sample interview is contained in the appendices.


7.4 Private Vendors - Findings

Sales techniques were not followed. Only one of the interviewees asked the "who" question and none asked the "what, why, when, how" questions. Only one offer was made to send out printed details, and that arrived with no indication as to how to proceed, should there have been interest in making a purchase. The one vendor who sent out printed details, failed to make contact again to pursue the sales lead.

There were few indications of application of marketing theory. The marketing concept holds that vendors, "research the needs and wants of a well defined target market and deliver desired satisfactions" (Kotler et al, 1996, p28). At the time of the study, the advertising medium, ‘Loot’ has no specific column for ‘timeshare-for-sale’ advertisements. Resellers list their advertisements variously under ‘Holidays noticeboard - section 700’, ‘Holidays Abroad offered – section 710A’ and ‘Property abroad offered – section 360A’. This means that a particular market or markets are targeted in a sense, but not would-be timeshare owners specifically.


The manner of questioning and probing for answers may have caused the vendors to believe that answers given were ‘delivering desired satisfactions’, that is, satisfying my apparent need for information especially on costs.

Subjects demonstrated a good, working knowledge of timeshare. Their attitude towards timeshare was considered good, even though they had their own reasons for selling. There was some reluctance shown in tone of voice, and in needing to be prompted, to reveal more about exchange fees and maintenance charges. Exchange fees mentioned were inaccurate which could have confused an unknowing buyer. The ongoing financial commitment was revealed as a source of irritant which may generate negative feelings towards ownership.

7.5 
Private Vendors - Conclusions

No firm conclusions can be drawn from just six subjects. However, no evidence of salesmanship as defined by Johnson and Scholes was found, and little application of marketing theory was observed.

7.6 Further study


This area can be further explored with structured interviews and questionnaires.





8. Structured Telephone Survey of Private Vendors



8.1 Telephone Survey of Private Vendors - Summary

Survey basis was 31 telephone interviewees selected from private advertising in "Loot".
  • 81% of sellers consider the general idea of timeshare to be good or very good. 47% of sellers who have exchanged believe the exchange fees are high.
  • 62% believed their asking price was on the low side.
  • The average asking price per advertisement was £1,922.
  • The minimum asking price was £100 (one hundred pounds, confirmed), the maximum was £7,000.
  • 30% of private advertisers had used resale agents without success.
  • 68% of respondents were using or had used resale agents in the past, of these 35% did not recognise the agent they used as being on a list currently approved by the Timeshare Council.
  • The majority of owners attempted to sell up for reasons of financial hardship.
  • A significant, but unrecorded number, hold opinions about annual maintenance fees being too high.
  • 70% of respondents were male.
  • The biggest group of sales offered (42%) were for resorts in the Canary Islands.


8.2 Telephone Survey of Private Vendors - Background and Literature

According to studies done for Mintel (Marketing report, 1996) , "Timeshare is most definitely viewed in a negative light by a large proportion of the population". Of particular note, the Mintel study established from its base of 1,572 adults that:

  • 49% of people would not consider buying a timeshare.
  • 30% thought buying a timeshare restricted you to the same place every year.
  • 20% thought timeshare had a bad image.
The attitude of timeshare owners trying to sell is important, because they hold opinions that they will share with others via word-of-mouth. If that word-of-mouth opinion is negative, then negative feelings are more likely to be spread. Lutz (1975) found that when making a decision about trying a product innovation, the consumer is more likely to pay attention to negative information than to positive information and to relate news of this experience to others. Mintel's (1996) survey uncovered extensive ignorance about timeshare by non-owners. Many potential buyers will depend on the opinions of timeshare owners for an opinion of timeshare, therefore the role that private vendors play in the resale market is important. For this study, the purpose was to examine whether or not second-hand sellers would have a propensity to portray a negative image.

Exploratory telephone interviews were inconclusive, and in need of corroboration. Issues of negativity uncovered in this survey, within the rectifiable scope of the commercial timeshare industry, might be identified to the benefit of all those with timeshare inventory to sell.



8.3 
Telephone Survey of Private Vendors - Methodology 
Several design methods were considered to obtain the opinions of second-hand timeshare vendors.


The internet was considered a potential supplier of private sellers data. Those sources searched revealed a plethora of United States based advertisers with timeshare to sell notably in the United States, but very few UK based advertisers. Since the subject for this study was living in England, owned time in Europe, and was more likely to eventually sell to a European, the quizzing of US citizens was not considered to be very helpful.

Several newspapers in the UK carry advertising of timeshare properties and some of these also publish to the Web. One of these is free-ads newspaper Loot . The paper publishes in several regional editions as well as the internet. By entering the internet address search text below, [subsequently removed from this internet version of this report because Loot reorganised its files] over several weeks, a database was developed of UK private vendors.
This database had the advantages of (1) being representative of all people who use Loot to advertise in, (2) being representative of all parts of Britain covered by Loot. The telephone poll was (1)relatively inexpensive to conduct at low weekend telephone rates.

Between 16 October and 8 December 1997, 190 separate items of ‘timeshare-for-sale’ advertising were collected in this way, together with contact telephone numbers. After deducting duplicate advertising, the database of 190 was reduced to 49.>

8.4 Telephone Survey of Private Vendors - Pilot Questionnaire

So far as can be ascertained, the survey to private timeshare vendors was the first of its kind, so the questionnaire was itself a test pilot for future studies. After the first three interviews, original questions 3, 18 and 19 were dropped for their vagueness, or otherwise considered not essential to the study in hand.

8.5 Telephone Survey of Private Vendors - Questionnaire

Advertisers were called at random until 31 interviews had been obtained. Only two callers refused to be interviewed and four others suggested alternative times to be called back. The interviews were conducted, cold-calling, over two successive weekends, during December 1997, conducted variously between the hours of 15:30 and 19.30. Call-backs took place within this time, except one call where the caller was happy to pay for the call during a weekday evening.

8.6 Telephone Survey of Private Vendors - Data Analysis

The survey findings are highlighted in tables below.

8.7 Telephone Survey of Private Vendors - Literal Responses

Literal responses can be found in the appendices. Respondents were asked, "If there was one thing that could be changed at your timeshare resort what would it be?". A third (11 out of 31) said there was nothing that could be done to improve it. A further six did not know of anything that could be improved. Other comments varied with no one single factor emerging as commonly negative about any of the resorts. This indicates a strongly favourable attitude to the resorts themselves.

Respondents were asked, "Could anything be changed that would make you feel better about owning a timeshare?" Fourteen out of 31 responded in a manner indicating they were happy with timeshare. Six found fault with maintenance charges, believing them to be too high. Three mentioned the resale aspect as one in need of improvement.

Respondents were asked, "What is your main reason for selling?" Sixteen mentioned financial reasons of some kind. Four indicated they owned other holiday accommodation and one or more of these was surplus to requirements. Three mentioned health reasons. Eight of the 31 expressed opinions which showed frustration with timeshare tending to indicate that they would not recommend it to a close friend.

8.8 Telephone Survey of Private Vendors -Analysis of Survey


1. Introductory Question


Q1


What do you think about the general idea of timeshare? (Prompt: Is it.…)
Very good
48%
Good
35%
Poor
10%
Very Poor
6%
DK
0%
[ Key Finding Just 16% of vendors have negative attitude towards timeshare (Poor + Very Poor)]

2. Location


Q2


Being honest, do you think the location of the timeshare you are selling is
Very good
48%
Good
39%
Poor
3%
Very Poor
3%
DK
6%
[ Key Finding Only 6% hold negative views about the location of the resort they are selling]

[Note: Emphasis was placed on both the "you" words to try to gauge personal opinion. Any location might be very good or very poor according to personal taste. If the vendor thought poorly about location, this negativity could theoretically show up during personal sales negotiation.]

 


3. Price


Q4


Now, I’d like you to think about the price you paid for the timeshare, and being honest, do you think you bought at a…
Very high price
19%
high price
19%
just right price
55%
low price
0%
DK
6%
[Note: Additional comments from many that, considering the general drop in property prices, they believe they paid the right price]
[Keynote: 38% = paid a very high or high price, could be indicative of negative feelings ]



Q5. (Number of people replying on side axis:)



Q5


Thinking about your sale price, How would you describe the price you are trying to sell for now?


High
3%
Just right
35%
Low
39%
Trying to give it away!
23%




Keynote: 23% Trying to give it away = Indicator of desperation to sell.



 



4. Exchanging


Q6


Are you, or have you ever been, a member of RCI?
Yes 81%



No 19%





Q7


Are you, or have you ever been, a member of II?
Yes 45%
No 55%




Q8


Have you ever exchanged
Yes 68%



No 32%





Q9


Thinking about the exchange fees, are the charges
High 42%



just right 39%



Low 6%



Don’t know 13%



[Key note: Taking Q6, Q7 and Q8, more people appear to have belonged to an exchange organisation than make use of its facilities]



5. Agencies


Q10


I’d like you to think about the ways in which you have tried to sell your timeshare. Have you ever registered with a resale agent?
Yes 68%



No 32%







Q11


Can you recall offhand which ones? Which resale agents? [Prompt: do you recognise any of these? They are recommended by the Timeshare Council]
Primeshare
35%
Other
35%
ETOO
10%
Timeshare Resales
6%
The International Timeshare Bureau
6%
Travel & Leisure Advisory Services
3%
Tourism Advisory Group
0%
The World Wide Timeshare Hypermarket
0%
Michael Watson
0%




Q11a


Other resale agents : 11 Literal responses
  • Timeshare Options
  • Leisure Marketing
  • Onsite
  • Timeshare direct
  • Spanish One
  • Been Conned ... Gladstone Marketing, London. European Marketing UK, Watford.
  • …Auctions, Blackpool
  • One in Manchester,
  • UPSS in Sun newspaper
  • Don’t know
  • Bourse


In addition, several comments were made about poor service, or fraudulent practices, of "resale" agents, before answers were given. One fraud involved a respondent being told by a bogus agent that a buyer was "coming in next week" with the cheque for his timeshare. All he had to do was pay a £50 administration fee, and that could be sent in by cheque. When the respondent said he would call in at their offices and meet the "agent’s" client, the "agent" rang off.

Another involved a Lancashire agency taking money for registration then not following up with any contact with the vendor in "the last 2 years".



Q12 How long have you been registered with a resale agent?



6. Advertising


Q13


Apart from Loot, which was where I saw your advertisement, have you advertised privately anywhere else?


yes


19%


no


81%
[Key Note: Strong favouritism to just use 'Loot' as a selling medium]





Q14


Where else have you advertised?
card in window
3%
local paper
6%
other
13%



Q15 How long have you been advertising your timeshare for sale?



0-3 months


45%


3-6 months


13%


up to 12 months


25%


up to 24 months


10%


up to 3 years


6%




7. Demographics

Gender



Q23


Male responding 71%
Female responding 29%


8. Asking Price

Up to £1,000
26%
Up to £2,000
26%
Up to £3,000
32%
Up to £4,000
6%
Up to £5,000
3%
More than £5,000
6%
 Number of weeks offered for sale: 65% had one week; 23% had 2 weeks; 3% had more than 2.


8.9 Analysis of Private Vendors Survey by cross tabulations

 

table 2. Opinion of asking price by location of timeshare owned.



There is no significant relationship.

 



table 3. Opinion of Own Sale Price by Opinion of Exchange Fees

No significant relationship due to low statistics, but a cluster of "exchange fee high" with "vendor’s sale price low/trying to give it away!" 8/31 = 25% of respondents.



Absolute response


Opinion of Vendor’s own sale price


Base
High
Just right
Low
Trying to give it away!


Base


31


1


11


12


7


Opinion of Exchange fees












High


13




5


4


4


Just right


11




5


4


2


Low


3


1


-


2


-


Don’t know


4




1


2


1






table 4. Vendors Sale Price by Purchase Price


9 out of 12 who believed they bought at a high or very high price, now believe they are trying to sell low or at giveaway prices.



 


 



table 5. Examination of Exchange



The purpose in this cross tabulations was to try to uncover negative aspects of the exchange process. Membership of an exchange organisation is usually offered free to new purchasers. Exchange fees being regarded as high should cause concern for exchange companies..

The low numbers involved in the survey make finding trends very difficult to locate.

table 6. Period Registered with Resale Agents (approved by Timeshare
Council - "other"=non approved)


Measured against other resale agents, Primeshare who are the appointed agents for Club X, fare no better or worse than other agents, subject to proper scrutiny of actual sales volumes.



table 7. Registered with Resale Agent compared to Vendors Opinion of Own Asking Price


No significant relationship is found.




8.10 Telephone Survey of Private Vendors - Critique

Actual paid prices, resale prices asked, and prices which resale agents had been asked to achieve, were not asked for. This meant it was not possible to fully understand the role which price played in the marketing mix of a second hand timeshare.

The survey did not ascertain if vendors were still members of either RCI and/or II. It was not ascertained if vendors received free memberships or were paying subscriptions to both organisations.


8.11 Telephone Survey of Private Vendors - Conclusions

Comments made to literal questions had some overtones of negativity in the area of maintenance fees. The exploratory survey looked at exchange fees and suggested this was an area of ill-feeling. In this survey respondents were not reminded of the actual exchange fees, so their view was a perceived one unless they actually knew the charges structure when asked. In literal questions aspects of exchanging, fees and organisations, did not feature as a source of anything which could be improved. Maintenance fees were mentioned high on the list of things which owners clubs might reconsider.

The greatest sense of negativity about timesharing came when off-hand comments were made in response to questions about resale organisations. As most of these comments went unrecorded they cannot be quantified or analysed properly.

8.12 Telephone Survey of Private Vendors - Further Study

Future study might concentrate on the resale process via focus groups and one-to-one depth interviews. Effort needs concentrating on how best the timeshare industry, as a whole, can help second-hand vendors to be more wary about pitfalls of resale.





9. Overall Conclusions

Awareness of timeshare among non owners of timeshare is low. Timeshare owners are more likely to be aware of the potential likelihood of obtaining second-hand timeshare. Sale prices at resorts include marketing and sales expenses of up to 50% of the overall price so selling owners must be prepared to take a hefty drop over the price they paid at a developers site. Resale agents with knowledge of handling potential customers may fare better than laymen at selling, although the resale agents level of success is minimal compared to their inventory of timeshare weeks for sale.

Exchange companies should consider the benefits that might be gained by lowering exchange fees to reduce that negative feeling of 47% of exchangers who believe the exchange fees are high. This measure could reduce the numbers trying to sell and increase the numbers taking exchanges. The companies could also consider what help they might offer in the form of information about themselves which a private vendor could pass on to potential buyers unfamiliar with timeshare. This measure could help to speed up the sales of timeshare units and, for the companies, enhance business by bringing in people new to exchanging.

Resale agents should consider their proximity to resorts. One of the successful techniques for developers is that people come in off the streets to take a tour round. With near access to a resort, a resale agent could fare better.

9.1 Overall Conclusions - Marketing Recommendations For A Second-Hand Timeshare

Based on the study of UK developers, a private vendor might consider:
  • Adopt a professional approach.
  • Put together a small direct mail campaign to any likely contacts the vendor may know, with an inspection holiday at the vendor’s expense. These contacts are very likely to be of the same background as the original purchaser. If one of the main reasons for sale is the age of the vendor, then the vendor might look to people of a younger generation, perhaps connected to siblings. At the same time, offer a small reward to any contact that introduces a buyer. This might be achieved, for example, by offering an inspection holiday to a known couple who in turn shares that accommodation (if large enough) with a couple unknown to the vendor.
  • Follow-up enquiries. If someone vaguely says the holiday was enjoyable, but expresses no interest at that time, try again later. Try to find out what it is that prevents purchase, and then apply traditional sales techniques. If the quality of the holiday is slightly poorer than expected, make great play of the low offer price. If the price is the sticking point, make great play of the quality of the fabulous accommodations that are available all around the world to exchange into.
  • Pass on positive knowledge gained about where to buy low-cost flights from.
  • Consider adjusting the resort offer prices, so that the first year’s management fees will be paid. If the maintenance fee is £250, inflate your asking price by up to that amount. This will reduce the buyer regret effect since they will not be pestered straight off for this essential upkeep payment. They can then look forward to another "free" holiday next year if they purchase from you.
  • Unless a professional video can be afforded, do not make your own. The resort marketers in the UK set no great store by them.
  • National media is likely to be too expensive for the individual vendor, but a resale agent might be considered if there is no on site re-marketing effort going on.
  • Seller beware of bogus buyers.


10. Further Research

There is a wealth of sales research to test against timesharing. The following table of findings and implications for timeshare selling could set an agenda for many future studies.

table 8. Academic marketing theory and implications for timeshare.
Finding
Implication for a private timeshare vendor
Improved advertising increases the proportion of purchasers who are tolerant of a brand’s higher price (Broadbent, 1989)
Keep improving the words of any advertisement.
Perception of quality determined by price levels: too low = poor quality (Gabor 1988)
If determined to sell low, emphasise quality aspects of the ownership, such as the ability to exchange to top world class resorts.
25% off or a two-for-one promotion increases sales, but leads new purchasers to think they bought the product because of the deal (Scott, 1976)
If there is more than one week to sell, advertising "two for one" can be more effective at producing a sale.
Extravagant consumers are predominantly female tending to have higher than medium incomes. They want luxury, service, clothes, pampering (Bennett P., Burak P., 1975 "Designing Products for the Leisure Travel Market From Market Definition to Product Information" in Mill and Morrison, 1985)
Emphasise luxury and service, close proximity to any cosmopolitan areas
Nature people are young, well educated. They want new and different places, to avoid schedules and routines and to experience the universe generally (ibid.)
Emphasise exchange throughout the world.
Playsters are mainly young males. They want inexpensive, swinging, fun (ibid)
Emphasise location in respect to nightclubs, low-cost restaurants, any facilities to make a quick meal in the units.
Cautious homebodies are older, less affluent, less well educated. They want safety, security, perfectly predictable environment (Ibid)
If the resort has security gates, mention that. No need to mention exchanging. Luxury might imply "costly upkeep" so avoid that.


Chandon (July 1995) conducted fairly extensive reviews of sales promotion. The subjects mainly covered research into fmcg goods. Nevertheless the findings as summarised in table 9 have further implications for timeshare which may be tested in future academic studies.

table 9. Sales promotion experimental work and the implications for timeshare.(source for authors quoted: Chandon, Pierre Consumer research on Sales Promotions: A state of the art literature review, Marketing Management, V.11 N0. 5. July 1995)


Experimental results of academic work summarised by Chandon
Implications for timeshare selling
Human perception is well suited to the evaluation of changes rather than to absolute values (Kaheman and Tversky 1979) Property prices at the end of the 1980’s were generally higher than they are now. Owners who bought then perceive this fall in value and accept there will be some loss of monetary return on their timeshare ownership.
The perceived value of the savings and purchase intentions are increased if former prices are indicated (Bearden et al ,1984) especially if they are precise (Mobley et al, 1988) but even if they are exaggerated (Urbany et al, 1988) Quote the purchase price and/or current developers price with the current asking price. An exaggeration might be to quote selling prices at top class resorts, after all, through the exchange scheme an owner can go anywhere.
Consumers discount very large discounts unless they are familiar with the brand (Moore and Olshavasky, 1989) Very large discounts are unworthy, unless the ownership being sold is a familiar name. If the resort is affiliated to RCI or II, then these brand names are worth quoting. Better known resale agents will also fare better if a large discount is offered by the private vendor.
National brands are the only brands to attract new buyers to the category (Sivakumar and Raj, 1993) Quote a known brand name, such as RCI, in private advertising, to attract new-to-timeshare buyers.
Beyond a certain level, the perceived value of a price cut is higher when this type of discount is rare (Lichenstein and Bearden, 1989) Unless the asking price is wildly lower than others, the price alone will not attract a buyer.
Perceived quality of a brand is hampered by definitive price reductions but not by coupons (Schindler, 1992) Rather than offer big price reductions, encourage any inquirers to "money off" coupons if they respond by a certain date.
Reference prices are rarely used to assess the value of brands when consumers have access to external price information because they don’t trust their memory (Urbany and Dickson, 1991) The consumers value of "Club X" timeshare is based not on the developer’s valuation, but on the general level of timeshare prices, if they are aware of what these are.
Consumers compare actual prices to normal prices in the same store, but also to the cheapest price in the area (Biswas and Blair, 1991) Prices in one timeshare advertisement will be compared with prices throughout the magazine, and other available magazines.
Consumers reference prices are influenced by current prices and one’s own estimate

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